The early experience of China Southern Airlines in facing competition from fast rail suggests that high-speed trains will inflict heavy damage on Chinese carriers.
Although the state of air/rail competition will become clearer as more Chinese fast lines open, China Southern’s problems on the route between Wuhan in Central China and Guangzhou offers the best insight so far into the degree of competition that comes from the fast-rail network.
CapitalVue suggests a silver lining may be to relieve pressure on airport capacity, since the trunk routes will have fewer aircraft than expected before the railway construction program began. That could become an advantage for regional jets, which would otherwise be less likely to get takeoff and landing slots.
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